Silver Continues Its Rally… Reaches Highest Levels Since 2011 on Fed Rate Cut Expectations

A report from the Safe Haven Research Center showed that silver prices rose 1.9% in local markets last week, while global spot silver climbed 2.4% to close at its highest level since August 2011. The rally was supported by a weaker U.S. dollar, stronger expectations of continued monetary easing by the Federal Reserve, and investors shifting toward silver amid ongoing gold price gains.

Local and Global Performance

Domestically, 800 silver rose by EGP 1 to close the week at EGP 55 per gram, up from EGP 54. Globally, silver climbed from $42 to $43 per ounce, a $1 increase.

In local markets, 999 silver reached about EGP 69 per gram, 925 silver was priced at EGP 64, while a silver pound coin (925) stabilized at EGP 512.

Year-to-Date Gains

Since the beginning of the year, silver has risen locally by 34% (EGP 14 per gram), while globally it has surged from $29 to $43 per ounce, a gain of $14 or 48.3%, ranking it among the best-performing precious metals in 2025.

Despite a 0.29% rise in the U.S. dollar index to 97.647—normally a headwind for dollar-priced commodities—both gold and silver extended gains, reflecting strong underlying market momentum.

Fed Policy Support

The latest surge in silver has been largely driven by expectations of Federal Reserve rate cuts. According to CME FedWatch Tool, markets currently price in a 91.1% probability of a rate cut in October and an 80.4% chance of another quarter-point cut in December.

Lower interest rates reduce the opportunity cost of holding non-yielding assets like gold and silver, creating a favorable environment for precious metals.

Industrial Demand and Investment Inflows

Beyond monetary policy, silver prices are also buoyed by robust industrial demand—particularly from the electronics and solar energy sectors—alongside strong investment inflows into silver-backed ETFs. With global economic uncertainty rising, investors continue to seek safe-haven assets, which further supports the white metal.

Risks and Outlook

However, risks remain. A slowdown in industrial demand or sudden hawkish pivots by central banks could cap further gains.

In a recent note, HSBC projected a positive medium-term outlook for silver, citing gold’s strength, rising geopolitical risks, and firm industrial demand. The bank expects silver to break above $45 per ounce by the end of 2025, provided the Fed delivers additional rate cuts.

Historical Comparison: The $50 Ceiling

The report highlighted that silver has only twice reached the $50 per ounce mark in modern history:

1980: During the “Hunt Brothers” saga in the U.S., when Nelson and William Hunt attempted to corner the silver market, pushing prices to record highs before a dramatic collapse following government intervention.

2011: At the height of the global financial crisis and European debt turmoil, investors poured into silver as a safe haven, briefly lifting prices back to $50 before retreating as global economic conditions improved.

These episodes underscore that silver’s climb to $50 is typically tied to extraordinary circumstances—financial crises or speculative bubbles—making it a psychological ceiling that investors watch closely during times of market stress.